Late last year, a pair of major climate pledges marked a public coming-out for one of the sector’s newest entrants.
In October, among the 20-plus funders that committed more than $300 million to a global effort to reduce methane emissions was a name not before seen on such lists: Sobrato Philanthropies.
The next month, it happened again. Five nations and 17 foundations pledged $1.7 billion to support Indigneous land rights in tropical forests. Again, the Mountain View, California-based grantmaker was among the signatories.
The two commitments were not spur of the moment. They grew out of a nearly year-long process driven by a new generation of the real estate clan, who have been pushing the family’s foundation to move beyond funding in the Bay Area to directly address complex global challenges.
“As a place-based funder, we had been more reactive,” said John M. Sobrato, who chairs the family’s business. “It was really the third generation, but certainly, the second generation, too, that felt we should broaden our aperture and look beyond Silicon Valley… at some of the broader, more systemic problems — and take more of a strategic approach.”
With that goal in mind, climate change quickly emerged as a priority shared by the whole family. The Sobratos — who my colleague Ade Adeniji profiled earlier this year — put half of their philanthropic dollars in a collective pool and reserve the rest for individual giving. Some members had funded climate on their own in the past, but the family is now directing joint resources to confronting the global emergency. They have committed $23 million over three-plus years to their family philanthropy’s climate portfolio, including making nearly $7 million in grants since last November.
Those figures are quite small next to the Sobratos’ overall fortune. They also represent only a ripple in the climate funding sector, which counted $1.9 billion in foundation funding in 2020, though it only accounted for 2% of global philanthropy that year.
But there’s a lot of wealth waiting in the wings, here. With a family fortune estimated at nearly $6 billion, thanks to a business that reached $10 billion in assets a few years ago, plus a commitment from John M. and his parents, John A. and Susan Sobrato, to donate 100% of their wealth during their lifetimes or upon their deaths, these could be the first steps of a family of climate mega-donors.
The Sobratos have plenty of company there. They join a list of uber-wealthy individuals and families who, over the past year or so, have made steps to grow their climate grantmaking, or promised to do so. That includes Laurene Powell Jobs’ 10-year $3.5 billion climate pledge and Arthur M. Blank’s new commitment to make environmental philanthropy a core priority. And for least one expert, the Sobratos’ moves reflect a wider expansion of climate grantmaking throughout the ranks of family philanthropy.
Here’s a look at what this billionaire family chose to support in the climate field, and whether that support might grow further.
What are the Sobratos funding, and why?
Once the family had committed to growing its grantmaking and chosen climate as a new focus, it had to choose where to send its checks.
Buildings and construction — which account for roughly 40% of carbon dioxide emissions — seemed like an obvious choice for a family that made its fortune building offices and homes for Silicon Valley’s techies. But they ended up concentrating on sustainable building efforts within their for-profit business, which is now headed by a non-family member, and address areas they saw as more impactful through their philanthropy.
Sustainable building “was one of the first things that naturally came to mind,” John M. told me. But the principles of effective altruism led him and his wife, Timi, to consider other areas. “We didn’t see as clear a path to effective change as we did in methane and deforestation,” he said.
With help from the Climate Leadership Initiative and CEA Consulting, the family and its foundation team spoke to nearly 50 experts last year as they honed in on those two broad topics: (1) methane, oil and gas and (2) deforestation and Indigenous and local communities. It was a desire to respond to urgent and underfunded needs that led to those selections, said Prithi Trivedi, director of family initiatives and new opportunities at Sobrato Philanthropies.
By chance, the family’s initial grantmaking coincided with last year’s big pledges on methane emissions and Indigenous land rights. The family finalized its focus areas in September, the first pledge was announced in October, and the foundation issued the first slate of grants in November, when the second pledge also came out. “It’s all been very rapid,” Trivedi said.
The portfolio’s two biggest grants to date are a pair of multi-year commitments to organizations associated with the two major pledges: one to the Methane Hub, and another to the Tenure Facility, which works directly with Indigenous communities on land rights. (Sobrato Philanthropies requested that I not release grant amounts because it had not asked permission from grantees.)
The Sobratos have also sent one-year grants to a range of organizations across the climate movement, including a philanthropic group (Funder Collaborative on Oil and Gas), a top climate justice intermediary (Hive Fund for Climate and Gender Justice) and a major green group (Environmental Defense Fund). A smaller, final grant went to the Methane Partners Campaign, which is run by a coalition of 20 of the nation’s largest environmental organizations. Investments are also in play, with the family taking a $1.5 million stake in Aclima, an emissions and pollution measurement platform.
The Sobratos’ varied mix of funding strategies is an approach that seems to be growing more common among climate funders. Although some new entrants have taken a narrow tactical approach (such as the climate-related grants from Mark Zuckerberg and Priscilla Chan, which have primarily gone to technology and research), many are heeding long calls for a diversity of tactics.
For instance, funding for climate justice and movement building made up a substantial portion of a recent round of climate grants from Builders Initiative, Lukas Walton’s funding outfit, though its biggest checks went to research and policy. Bezos Earth Fund has also adopted varied tactics, beginning with its first grants. The question remains whether funders are getting the balance or amounts right, particularly given historic inequities.
Climate philanthropy is increasingly a family affair
The Sobratos are far from alone in the wider world of family grantmaking, according to Nick Tedesco, president and CEO of the National Center for Family Philanthropy.
“Many families are expanding their portfolio on climate, or accelerating their rate of spend,” he told me. (The Sobratos have been part of NCFP for many years, he noted, but the network has a policy about not speaking specifically about its members.)
Tedesco finds that most family donors choose their focus based on four factors: interest, experience, observation and opportunity. For example, a donor’s personal battle with cancer might lead them to support treatment and research. Tedesco sees climate support rising as families witness the growing impacts in the U.S. and abroad — and see the dire need for additional funding.
It is also increasingly impossible for any funder to ignore the wide-reaching impacts of a warming world. As a recent NCFP blog post noted, climate is a health issue, an education issue, an economic issue, a social equity issue and more.
“The climate crisis is at the nexus of nearly all of the most prominent issues that family philanthropies prioritize,” wrote Katherine Lorenz, a senior advisor to NCFP and president of the Cynthia and George Mitchell Foundation, in the post.
Will the Sobratos ramp things up on climate?
In a 2019 interview with the Nob Hill Gazette, patriarch John A. Sobrato was asked what’s next for the family’s giving. He spoke about the family’s desire to send funding outside the United States, noting that he believed there was greater impact to be had abroad. He also said a whole lot more money was on the way.
“Over the next five years, every time we build another project, we’re going to sell an existing project in the same dollar amount and put those funds in the foundation. This means that over the next five years, we’ve got a pipeline of about $2 billion worth of new business. We’ll be selling off $2 billion over the next five years,” he told the publication.
I asked the foundation if that plan was still underway.
“John Sr.’s comment was based on estimates and plans at that time, before the pandemic and many other developments,” a spokesperson said in an emailed statement. “While those numbers have inevitably fluctuated with shifts in the economy, the Sobratos have remained committed to increased grantmaking and plan to accelerate the pace of their giving.”
The spokesperson declined to share specific figures on what that might look like, but did note the foundation and family granted a total of $161 million in 2020, nearly twice its projected amount, and committed another $160 million last year. The family gives through a variety of vehicles, including donor-advised funds and personal gifts, and its foundation grantmaking typically exceeds the 5% payout rate. For instance, the Sobrato Family Foundation, which had $577 million in assets in 2019, distributed between 7% and 20% of its assets in prior years.
The Sobratos are active philanthropists, much more so than many at their financial altitude. Yet if the family wants to fulfill its Giving Pledge commitment to give it all away, a whole lot more money needs to go out the door. If Forbes’ estimate of the Sobratos’ wealth ($5.8 billion) is accurate, back-of-the-envelope math suggests that their current rate of giving (roughly 2.8%) barely keeps up with historic U.S. inflation, let alone modest investment returns — or the Bay Area housing market.
They might take a page from another recent entrant to the climate space, MacKenzie Scott, who has set a whole new standard for billionaire philanthropy. Pace of giving aside, they already share some priorities, including one grantee: the Tenure Facility. Scott recently sent hundreds of millions of dollars to such regranters, including many others also led by or working directly with Indigenous communities.
Regardless, it’s encouraging to see families like the Sobratos start making climate grants. But with the world’s top climate scientists warning that it’s “now or never” to act on the emergency, as laid out in detail in the latest report by the United Nations’ Intergovernmental Panel on Climate Change, it’d be much more encouraging to see the Sobratos, their fellow Giving Pledge signatories and other mega-donors spend with even more urgency.